Focus on YOUR Trading, Not Someone Else’s

On the technical side, swing traders may finally be seeing a meaningful daily
trend taking hold on all major indices which is attempting to become the
predominant timeframe in play.  Yet we’ll again let the charts do the yakking
and then talk a bit about events of the past week from this trader’s
perspective.

Yet if I had to grade my trading in a week that had a few sharp moves on a A-F
scale, I’d frankly give it a A – … ironically an extremely high grade for a
trader who tends to be very hard on himself.  Then again, it’s not unusual at
this end to grade modest draws or scratches higher than the winners … for
only the major losses will take you out of the game.

Could I have traded better?  It’s likely (of course there hasn’t been a day
since I started this business years ago that I haven’t felt the same way),
yet when I look back at the week I feel pretty darn good about my trading.  I
say that in part because over the course of the week I remember trading one of
my favorite high-probability setups twice, both times with pretty decent size
which I try to do on the higher % entries, and both times they stopped out.  In
one case, the stop looked great in hindsight, while in the other case it looked
stupid. 

But rules are rules and we’ll try to leave hindsight B.S. to those who never
have losing trades.  Plus, I just didn’t “feel” particularly in sync with the
earnings-driven low-liquidity knuckleball pace typical during this time of
year.  And as many of you know, market pace means a great deal to me given a
plan that seeks very high-probability scalps.  Interestingly enough, the best
“feel” trade of the week was just before 3:00 P.M. ET this afternoon, where
setup, personal rhythm, market pace and volume all combined nicely for a
textbook post-breakout first pullback trade sequence.

Which brings me back to a familiar topic, especially for those who have contact
with other traders in the context of columns, chat rooms, or the like.  Of
course, if you’re reading this, you do have “contact” with at least one other
trader … duh.  The topic of course is it doesn’t matter what kind of week
anyone else had … focus on your setups, execution, and results. 

Case in point: I had a conversation with Larry Connors this week where we were
discussing recent results, among other things, and he shared with me the fact
that he knew of an individual that had a major home run day this week.  I’m sure
you’ve all had similar conversations with trading peers from time to time.  Now
in hearing that, I basically had one of two ways to take such information:  (1)
Fret over why I didn’t accomplish a similar result … after all, if (a) you
consider yourself a half-decent trader, (b) the market moved nicely, and (c)
someone else has a great day, why didn’t you?  Or (2), say “great” and move
on, knowing that style and setups may have been very different than yours.  Or
perhaps the styles were similar, but you were just a bit off your game.

If I had a nickel for every time I chose #1 in the early days, well I’d have the
proverbial pile of nickels.  But the market is an equal opportunity market as it
changes rhythms to both simultaneously reward and frustrate the heck out of
those whose rhythms may or may not be presenting themselves.

Miss a bus?  The bus route runs daily.  Get run over by a bus?  We’re talking
major healing time … if you survive.  Yea, I dodged a few buses this week that
rode a bit close to the curb for me and then trashed the stop (yea, pun very
intended … apologies, as I’m very punchy and writing this Friday afternoon on
three hours sleep.  Could be worse, I could be calling the market a box of
chocolates).

As we’ve preached since we began this trek long ago … the key word is “long
term”.  Like many of you, I know a great many folks who shared publicly and
rather vocally that they had a great home-run day(s) in 1999 who self-proclaimed
their trading genius, yet unfortunately can count on one hand those of that
group who still have adequate capital left today.  It’s a very sad story. 

As I shared in detail with Larry during our talk, the market has been very kind
to me in ’04 with results which continue to justify the decision I made long ago
to take up this crazy business.  Joining the CME has particularly had a
significantly positive impact on my bottom line and there is no doubt that the
particular business plan I’ve chosen works for me.  Yet as I told those
attending the weeklong event, it’s A business plan … not THE
ONLY or BEST plan which doesn’t exist.

Yet for those new to this piece — and you can call it superstition or whatever
— I choose to leave any success discussions at that, prefer to continue to
highlight the challenges of this business from a reality and teaching
perspective, and deflect any pats-on-the-back to a more Appropriate source as I
still haven’t found that day where I trade perfectly.  Success at this end is
the simply by-product of getting out of my own way more times than not.

For all of us, trading income in a day, week, or year buys one thing … chips of
a very limited and precious resource called time, all of which get used
eventually, both during and after one’s career.  I cashed in a few time chips
this week, and will be back waiting at the same bus stop on Monday.